Good news: Nintendo wants to do Kid Icarus Wii
Bad News: They're farming it out to Factor 5 who wants to do a story about Pit as a badass fallen angel cursed for 1000 years and sent to the underworld and covered in tattoos of various sins and then forced to fight his way out to slay gods. Basically, they want to do God of War but with Kid Icarus.

http://www.joystiq.com/2008/05/08/kid-i ... ed-by-ign/
http://wii.kombo.com/article.php?artid=11895
This guy says it best:
Thank god they're making Kid Icarus more hardcore. Not a day goes by when I don't think "You know, they need bring back Kid Icarus, but like, give him some tats and badass armor. And, like, he shouldn't be a kid, neither! and he'd be all headshottin' people with the arrows! "
I also hope they opt for drab brown color palette. That'd be bitchin'.